Wall Street Stays Bullish While Global Traders Hit the Exit

The same bitcoin, two completely different reactions. While Wall Street institutions keep doubling down on their bitcoin bets, offshore traders are quietly heading for the exits—and the numbers tell the story.

The Basis Gap Tells All

The clearest evidence lies in futures basis—the premium traders pay for futures over spot prices. It's essentially a real-time measure of how badly people want to own bitcoin.

On CME, where U.S. hedge funds and institutional desks dominate, traders are still paying hefty premiums to maintain their long positions. Meanwhile, on Deribit, the offshore platform favored by international traders, that premium has dropped significantly.

"The more pronounced drop in offshore basis suggests reduced appetite for leveraged long exposure," explains Greg Cipolaro, NYDIG's head of research. The widening spread between these platforms has become "a real-time gauge of geographical risk appetite."

Quantum Fear Was Just Market Jitters

When bitcoin tumbled to $60,000 earlier this month, many blamed quantum computing fears—the idea that advancing quantum technology could crack bitcoin's cryptographic security. NYDIG's analysis reveals this narrative was likely wrong.

Here's the smoking gun: bitcoin's price movements closely tracked quantum computing stocks like IONQ and D-Wave Quantum. If quantum technology truly threatened crypto, those stocks should have risen while bitcoin fell. Instead, they dropped together.

This suggests the selloff wasn't about quantum-specific risks but rather a broader retreat from long-term, speculative assets. Even Google search data supports this—interest in "quantum computing bitcoin" actually rises when bitcoin's price goes up, not down.

Two Different Investment Philosophies

The regional divide reflects fundamentally different approaches to risk and time horizons.

U.S. institutional money operates with longer time frames and deeper pockets. They're betting on bitcoin's role in the evolving financial system, viewing short-term volatility as noise. The steady flow of institutional money into bitcoin ETFs since their approval reinforces this patient capital approach.

Offshore traders, particularly retail investors in Asia and Europe, respond more quickly to market volatility. They're playing shorter-term moves and are more sensitive to technical signals and market sentiment shifts.

The Regulatory Factor

Regulatory clarity also plays a role. U.S. institutions operate in an increasingly defined framework, especially after ETF approvals gave bitcoin a stamp of legitimacy. Offshore markets still grapple with regulatory uncertainty, making traders more skittish about maintaining leveraged positions.

This creates a feedback loop: as offshore traders reduce leverage, basis drops, which can signal weakness and encourage more position-cutting.